HCMC – The European Union (EU) has announced a new Generalized System of Preferences (GSP) for developing nations, including Vietnam, which will come into force on January 1, 2014.

The European Parliament and the European Council have passed the revised GSP with import tariff incentives, reduced or zero tax rates, and import criteria that are favorable to developing countries.

The new GSP narrows down the range of beneficiaries in order to provide developing nations with higher effectiveness. In addition, the countries that are properly and efficiently implementing the international treaties on human rights, labor, environment and State management will receive many supports, said a source from the Europe Market Department under the Ministry of Industry and Trade.

The current GSP is still valid until January 1, 2014. During this time, policymakers need to adjust the economic policies to adapt to the new mechanism that will take effect after then.

Taking into account the proposal of the European Commission, the European Parliament and the European Council have created incentives for a wider range of products, although the number of incentives is still limited.

The time for applying the new GSP is longer and self-protection measures for plain fabrics and ethanol are enhanced.

Vietnamese goods exported to the EU will gain more advantages as many rivals will be removed from the list of beneficiaries

However, to fully benefit from the tariff incentives offered by the new GSP, Vietnamese exporters must comply with the international treaties on labor and environment.

In the first ten months of 2012, the country’s export turnover reached US$93.45 billion, up 18.4% year-on-year. Exports to the U.S. grew by 17%, accounting for 17.4% of the total export turnover, while exports to the EU picked up 20.1%, making up 18.2%.